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Havells India Q1 - Margin Pressures Offset Topline Growth; Expect Margins To Normalise From Q3: Nirmal Bang

Havells India Q1 - Margin Pressures Offset Topline Growth; Expect Margins To Normalise From Q3: Nirmal Bang

<div class="paragraphs"><p>Havells India fans displayed inside a store. (Source: BQ Prime)</p></div>
Havells India fans displayed inside a store. (Source: BQ Prime)

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Nirmal Bang Report

Havells India Ltd. reported Q1 FY23 revenue of Rs 42.3 billion, up 62.8% YoY, beating our/consensus estimates by 4%/8.3% on the back of healthy growth across all business verticals.

Switchgears/cables/lighting and fixtures/electrical consumer durables/Lloyd grew by 38.4%/47.8%/76.8%/45.5%/119.2% YoY. Gross margin contracted by 670 basis points YoY due to the challenges posed by commodity cost pressures.

Havells India's Ebitda grew marginally by 2.3% YoY to Rs 3.6 billion. Ebitda margin declined by 510 bps YoY to 8.5%, way below our/consensus estimate of 11.4%/12%.

Volatility in metal prices affected margins, particularly in the cables segment. Profit after tax grew by 3.5% YoY to Rs 2.4 billion.

The bottomline was below our/consensus estimate by 24.1%/23.2%. However, the management expects margins to normalise from Q3 FY23.

Click on the attachment to read the full report:

Nirmal Bang Havells India-Q1FY23 Result Update- 21 July 2022.pdf

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